Witnesses at Fumo's corruption trial said Palermo helped run Fumo's farm near Harrisburg.
Palermo was charged with mail fraud Wednesday in a federal information. Defense lawyer Robert Scandone did not immediately return a message.
Palermo once served as chief of staff at Fumo's district office in Philadelphia. The powerful Democrat awarded him annual consulting contracts from 1999 to 2003. Authorities can find no evidence Palermo did any work.
Fumo is serving a four-year prison term in Kentucky.